Shift4 Payments, Inc. (NYSE:FOUR) Q1 2023 Earnings Call Transcript

Shift4 Payments, Inc. (NYSE:FOUR) Q1 2023 Earnings Call Transcript May 4, 2023

Shift4 Payments, Inc. beats earnings expectations. Reported EPS is $0.51, expectations were $0.36.

Operator: Thank you for standing by. My name is Briana, and I will be your conference operator today. At this time I would like to welcome everyone to Shift4’s First Quarter 2023 Earnings Conference Call. [Operator Instructions] I will now turn the call over to Tom McCrohan, you may begin your conference.

Tom McCrohan: Thank you, operator and good morning, everyone and welcome to Shift4’s first quarter 2023 earnings conference call. With me on the call today are Jared Isaacman Shift4’s Chief Executive Officer, Taylor Lauber, President and Chief Strategy Officer; and Nancy Disman, our Chief Financial Officer. This call is being webcast on the Investor Relations section of our website, which can be found at investors.shift4.com. Our quarterly shareholder letter, quarterly financial results and other materials related to our quarterly results have all been posted to our IR website. Our call and earnings materials today include forward-looking statements. These statements are not guarantees of future performance and our actual results could differ materially, as the result of certain risks, uncertainties and many important factors.

Additional information concerning those factors is available in our most recent reports on Forms 10-K and 10-Q, which you can find on the SEC’s website and the Investor Relations section of our corporate website. For any non-GAAP financial information discussed on this call, the related GAAP measures and reconciliations are available in today’s quarterly shareholder letter. With that let me call – turn the call over to Jared. Jared?

Jared Isaacman: Thanks, Tom. Good morning, everyone. So we are pleased to report a reasonably strong start to the year, including quarterly results that we believe will put us on pace to meet or exceed our previously provided guidance ranges. We set quarterly records for end-to-end volume, gross revenue less network fees and free cash flow. Our performance was driven by momentum within our high-growth core, contribution from new verticals and ongoing success converting gateway volume to our end-to-end service. Our 2023 plan assumed a likely pullback in consumer spending. For the most part, we did not observe any concerning spending trends in the quarter. January and February exhibited typical spending patterns but we did see spending moderate towards the end of the quarter.

Early March was in fact strong including record weekends around St. Patrick’s Day, but there was some softness in the last week of March. This does seem consistent with commentary provided by others. We are cautiously optimistic on April data, but the real test will be in May and June, where we would typically expect to see seasonal strength. So while we have positively revised our guidance for the quarter, we are taking in account and watching closely this data. It is important to emphasize that today restaurants represent approximately 40% of our total end-to-end volume compared to around 55% of our volume back in early 2019. This percentage shift occurred despite growing restaurant volumes and is due to our rapid growth in hotels, new verticals and larger enterprise merchants to our mix.

On that note, we currently have roughly 50 merchants processing more than $100 million of annualized volumes on our end-to-end platform and an additional 70 that are in the addressable gateway-only population. We expect this trend of adding large enterprise merchants either through us converting a gateway customer or simply winning a net new merchant to continue and only accelerate as we expand internationally. This diversification is what gives us the confidence to raise guidance even in the face of what is still an uncertain economic environment. So now on to our quarterly performance and results. For the first quarter, we generated 66% year-over-year growth in our end-to-end payment volume, 36% year-over-year growth in gross revenues and 34% year-over-year growth in our gross revenue less network fees, which were all quarterly records.

Our high-growth core continue to be the primary driver of our growth with an increasing contribution derived from newer verticals, such as sports and entertainment, Sexy Tech travel and leisure and gaming. We are very proud of our overall profitability, which is derived from the following four factors: a, continued momentum serving high-growth enterprise accounts, which require less overhead; growth in new and predominantly card not present verticals, which require less hardware; our Gateway sunset initiative where we are deleting unnecessary parts and properly monetizing the value of our gateway services; D, consolidating legacy POS brands and a direct sales model in support of our SkyTab POS program. All of these initiatives have either reduced or eliminated growth CapEx requirements relative to prior years and enhance the overall unit economic model of our services.

I will focus the rest of my comments on three areas; our high-growth core; new verticals; and our global expansion initiatives. So with — starting with high growth core at Shift4 our high-growth core does continue to be the primary engine of growth. And as a reminder, our high-growth core includes the entirety of our business at the time of the IPO and is our core integrated payments offering built on a library of over 500 mission-critical software integrations and over $150 billion of gateway volume available for conversion as of March. With many years of success executing on this strategy, we are still clearly in the early innings of our gateway conversion sunset and further monetization strategy. Our win rates between net new merchants and gateway conversions along with their associated take rates all remained consistent and stable.

A component of our high-growth core also includes our new restaurant POS system named SkyTab. Like last quarter, we have added thousands of new systems with our — and our Q1 volume growing at over 300% on annualized growth rates. We are uniquely positioned in our ability to offer our SkyTab POS across multiple verticals we serve including stadiums theme parks and hotels. So for example, this past quarter we successfully renewed and expanded agreements with two major hotel clients, which also includes them promoting SkyTab in their restaurant locations throughout their franchise. Considering our strong presence in hotels and our close relationship with software companies that serve hotels, we believe this new business pipeline for SkyTab is very promising.

Additionally, SkyTab POS capabilities are evolving quickly and we recently entered into partnership agreements with OpenTable and Restaurant365, the two leading providers of online reservation and accounting software for the restaurant industry. As a reminder, the insourcing of our restaurant distribution late last year was time to coincide with the launch of our new cloud-based SkyTab POS products offering. This important initiative served two purposes; first, it substantially improved the margin cash flow and unit economic model of our POS offering by pivoting to a more direct sales model. So this initiative not only eliminated a recurring commission expense from existing accounts, but also from all new accounts going forward since we essentially hired 400 of our best partners as a component of the in-sourcing initiative.

So we basically acquired a costly variable expense and took on additional overhead in markets that we know we’re going to have a lot of demand for SkyTab the results of which we believe are working out very, very well so far. Second, it also allowed us to gradually sunset several of our legacy POS software brands. So as a reminder that includes Future POS, POSitouch restaurant manager and Harbortouch. And basically, unify and energize our development, engineering, sales and service efforts to a single product strategy, which is SkyTab POS. So this represents a significant efficiency gain that we believe will play out over many, many years and enable us to continue to grow rapidly without having to add head count. And also freed up resources and capacity to run the playbook of acquiring another legacy POS software company, cross-sell their customers’ payments and eventually migrate their customers to our modern SkyTab software solution.

This is very textbook Shift4. So we are back at it again. We completed an acquisition that has interested us for more than five years. So this quarter we acquired a POS software company called Focus POS, which supports over 10,000 restaurants representing up to a $15 billion payment opportunity that are not on Shift4. Focus POS does not have a direct payment processing capability and instead of relies on several other vendors, including an existing software integration with Shift4, which allows us to work very, very quickly. By acquiring Focus POS, we’ve added a major talent in the form of Mike Hamm. And together we are executing on a playbook that we know very, very well which is by owning the software we plan to bundle payment processing capabilities and over time convert the installed base of 10,000 plus Focus POS merchants to use Shift4 payments and eventually migrate to SkyTab.

Like we’ve shown in the past, we believe this approach represents a very low-cost way to acquire established high-quality integrated payment restaurant customers. And as Taylor will talk about in a minute, we believe that Focus POS acquisition will ultimately prove to be an organic revenue and volume contributor in 2024 and as we wind down the existing revenue model of the business so moving away from their historic hardware and software license sales model and instead we will pivot them towards a payments and SaaS strategy consistent with the comparable deals we’ve done in the past. So in short, we expect minimal revenue and volume contribution in 2023 and our guidance raise can be attributed entirely to Q1 outperformance and a slightly more optimistic view of the 2023 macro picture.

So moving on to hotels. We signed numerous signature resorts during the quarter, including the brand new 60-acre resort property named VAI, which is now Arizona’s largest resort. Additionally we signed two large Las Vegas properties one being an especially new and notable entertainment center. We also signed Woodloch SPA retreat located in Pennsylvania ,The Lucerne Hotel in the Upper West Side of Manhattan. These signature wins represent a nice balance between gateway conversions and simply net new wins, leveraging the power of our 500-plus unique software integrations. So moving on to new verticals. Our end-to-end volumes continue to benefit from incremental contributions from verticals within — from merchants within our new verticals, which overall still have a long runway before reaching steady state levels.

We define new verticals as consisting of all the new end markets we entered into post our IPO, including sports and entertainment, sexy tech, travel, nonprofits and gaming, as well as volume contributions from international expansion APMs, which is our alternative payment methods and crypto donations. It’s worth reiterating that as we continue to expand internationally and partner with international gateways and APMs like PayPal, we may not be directly settling funds for those payment transactions. The impact of which is that our gross revenue and gross revenue less network fees will essentially be the same, bringing this to your attention so you can take that into consideration when modeling future gross revenue in the context of international and APM volumes becoming an increasing portion of our mix.

The overall ramp in new verticals witnessed late last year continued into this quarter with a nice uptick in volumes from our stadium and entertainment vertical, including incremental ticketing volumes, travel, gaming and of course our strategic enterprise relationships. Our recently announced partnership with PayPal also began to ramp throughout the quarter. In sports and entertainment, we will process all food and beverage volume for the Washington commanders of FedEx Field as well as the Chicago White Sox where we will process not just concessions at guarantee field, but all of their parking in retail too. In college sports, we signed an agreement to process food and beverage with the University of Arkansas and Oregon State University. Outside of sports, we also signed all the Six Flag locations in the US for their food and beverage operations along with the ticketing and payment processing agreement with popular water park in Denver called Waterworld and all food and beverage processing for Chicago’s Lincoln Park Zoo.

In ticketing, we are live with Paciolan and we are processing all ticketing for the Wells Fargo Center in Philadelphia. including advanced sales for non-sport performances, including the recently announced Alicia Keys summer tour. Now that Paciolan is live, we will now begin pursuing ticketing for college athletics as well, which includes advanced season ticket sales. In gaming, we went live last week in seven additional states throughout our partnership with BetMGM and are currently operating in 14 online jurisdictions. Shift4 also added OCT as a product offering, which is highly desired in the gaming market. Two online operators currently in integration are adding OCT to their go-live, which is anticipated later this quarter. Shift4 signed an agreement with Light & Wonder, the leading cross-platform global games company in the digital and brick-and-mortar casino verticals.

Photo by Blake Wisz on Unsplash

Specifically Shift4 will provide processing for Light & Wonder’s Adam product, which is a cashless gaming solution for table games. Adam enables players to access funds via a debit card transaction without leaving the table. Initial support will be in the US, but we are also adding Canada. Moving on to nonprofits. We entered 2023 following a year of remarkable growth in the number of nonprofits, joining the Giving Block marketplace despite an otherwise really challenging year for crypto in general. We added over 1,000 nonprofit clients last year, bringing our current roster of nonprofits connected to our donation platform to over 2,000. The pipeline to cross-sell card processing to this space has grown considerably especially when you consider over 150 nonprofits currently on our platform processed more than $100 million of annual donation volume.

As a result, the initial $45 billion-plus cross-sell opportunity we sized for you when we initially announced the Giving Block a year ago is now well over $50 billion of cross-sell. The $50 billion represents just the donation volume associated with our existing nonprofit customers, the total charitable giving opportunity we’re pursuing is over $450 billion. We are still investing in capabilities including smart donation forms, recurring billing ACH and integrations to important third-party donor management software. We’ve recently added key enhancements to our products such as stock donations, peer-to-peer fundraising and donor accounts all of which we believe will increase our right to win the traditional card cross-sell which is why we pursued The Giving Block in the first place.

I’d highly recommend you to check out The Giving Block’s 2023 annual report on charitable giving which can be found at the givingblock.com for more key stats on the industry. Moving on to global expansion, as I’ve mentioned many times over the last 18 months, we’re on a Payments 3.0 journey. We are expanding organically and inorganically all over the world following a signature strategic merchant relationship and then bringing all the product, services and integrations that made us successful in the U.S. into those new markets. To that end, expansion remains our number one capital allocation priority both in terms of our M&A pipeline and organic investment initiatives. We are still awaiting regulatory approval from bank regulators in Europe regarding our acquisition of Finaro which remains the final obstacle to get this deal closed.

We recently met with the Finaro team in Europe as well as the regulators and believe the deal will close in approximately 90-days or less. Unfortunately, European banking regulators have had some high-profile and high-priority matters that have captured their attention in the last few months. We have made great use of this time though, between signing and closing. So over the last year we’ve completed technical integrations between Shift4 and the Finaro platform. We have begun processing live card-not-present transactions and now card-present transactions. We have collaborated on commercial opportunities, international expansion priorities, marketing and go-to-market strategy and the consolidated organization and operating plan. We are ready to hit the ground running after closing.

In fact, we feel so prepared that we’ve been able to shift a fair amount of attention to other opportunities in support of our Payments 3.0 priority. As a reminder, our 2023 guidance does not include any contribution from Finaro, which we will update accordingly following the deal closing. We are currently processing international volume in connection with the PSP we acquired last quarter and also benefiting from their strike like offering, which is focused on developers and online card-acceptance tools for our enterprise customers. We currently offer these online capabilities now in over 40 countries. Our organic expansion into Canada, the Caribbean and Eastern Europe is on track to be completed this year. And we are exploring a number of M&A opportunities that will expand our reach into LatAm, Africa and APAC.

Before handing the call over to Taylor, I want to provide some additional comments on how we are currently thinking about 2023, our capital allocation priorities and our general attitude towards success. We have been consistently forthcoming and expressing our concerns about the operating environment, including highlighting our concerns as early as March of 2022. As a result, our guidance and entire budgeting process has been informed by our view that current market conditions will test the sustainability of consumers’ willingness to spend. Our upwardly revised guidance assumes consumer spending remains reasonably stable with the low-end assuming a mild recession. Given this uncertain climate we’ve been laser-focused on controlling expenses and continue to plan for our headcount to remain as flat as possible for the year.

Our preference is to take advantage of the recent tech layoffs including at several companies we admire to upgrade talent where appropriate. I believe that is the responsible way to navigate the year ahead. Consistent with prior quarters, our top capital allocation priority is delivering on our Payments 3.0 Global Expansion requirements. We have a strong pipeline of opportunities ranging from completely transformational to strategically significant and smaller tactically beneficial transactions. We are generating a lot of cash, ending the quarter with an adjusted net leverage ratio of 2.5 times. Considering our stronger cash position, we have elected to make some small investments in facility upgrades, while at the same time closing and consolidating a number of our operating locations.

We also began making investments in internal system replacements to include a new sales force CRM which we believe will improve the efficiency and productivity of our workforce. Considering our strong balance sheet and our present EV to EBITDA Valuation being below prior buyback levels, our Board has authorized up to $250 million in share buybacks. While we are prepared to be opportunistic with this authorization, we are admittedly excited about a variety of other avenues available to create shareholder value. As a public company it’s pretty typical to spend earnings calls patting ourselves on the back and celebrating successes. I do want to know this isn’t the real Shift4 attitude though. I can assure you, as a management team, we pretty much only talk about the things we don’t do well at all.

To that end, we are constantly improving our products customer experience and internal processes to ensure we are always in a position to win, no matter how challenging the operating environment. We believe that even small incremental improvements can have a powerful compounding effect over time and we’ll get there by following the Shift4 way, which is all about embracing radical ownership, staying flat, taking out all the parts, being procedurally driven and executing with urgency. This is the way. With that, I’ll turn the call over to our President and Chief Strategy Officer, Taylor Lauber. Taylor?

Taylor Lauber: Thanks, Jared, and good morning, everyone. I’d like to provide some context around Jared’s remarks regarding the operating environment and update on Finaro and then our capital allocation priorities for the remainder of the year. As a reminder, we have multiple avenues for growth that are unique to Shift4. $150 billion of gateway volume, tens of thousands of software customers who are technically integrated to us, but using others for payment processing, an emerging franchise in several new verticals and very little presence internationally. In pursuit of all of these, we tend to grow in roughly equal proportions, with 50% coming from gateway conversions and 50% being net new customers. And unlike other payments companies, virtually all of our volume growth comes from customer additions as opposed to industry growth.

Although, our growing presence in e-commerce and international payments should be a nice tailwind for us. To give you just another way of thinking about the embedded opportunity, if half of our incremental volume growth this year were to come from gateway conversions, we would only need to convert roughly a-third of that to exceed our medium-term guidance and still have nearly $100 billion remaining on the gateway. This is without adding a single new customer. For the quarter, our volumes came in better than our internal expectations despite the modest softening Jared mentioned in late March. A notable contributor in the quarter was from our first transactions in Starlink, which we’ve been discussing with you all for several quarters now. We are still getting familiar with the volume cadence from our new verticals, including the timing for such things as season ticket sales or the total time an enterprise merchant takes to fully ramp their volumes after integrating to our platform.

Fortunately, we have several enterprise-level merchants that we now know are still in the ramp stage of their full volume potential. Our blended spreads are a reflection of a growing contribution from new verticals and enterprise accounts. International expansion and alternative payment methods will help balance this spread moderation as we pursue our Payments 3.0 strategy. But you should expect lumpiness as large merchants activate and ramp. Based on our updated guidance, we would anticipate our blended spreads to average around 65 basis points for the full year. It is important to note that several factors may influence our spreads from quarter-to-quarter. I pointed out one example in large merchants, but evolving seasonality, international business and APMs, all have an impact on the blended spread within a quarter.

To the extent volume exceeds our guidance it is likely that incremental spread may be a little bit lower during one quarter or another. In terms of our trends within high-growth core, we witnessed the expected benefits from increased travel this quarter from spring break through the Easter holiday and had an easier comp in January in light of Omicron’s impact a year ago. Spreads across our various cohorts and the high-growth core remained very stable. In regards to Finaro, our team is fresh off the European trip and meeting with the bank regulators. This is a final step in closing. The final step in closing is for our regulators to notify us that our application is complete, which triggers a 30 to 60-day clock for final approval. To-date, we have yet to be notified that our application is complete and our plans are to notify investors either via press release or 8-K upon hearing about this status.

Our advisers believe we are still on track to close Finaro by the end of June despite some unanticipated delays. I’d also like to mention that we have been very impressed with the team at Finaro and are excited to have this acquisition close. Once the deal closes, we anticipate providing an update on the expected financial contribution from Finaro for calendar year 2023 and updating our guidance accordingly. Turning to capital allocation. In early April, we acquired Focus POS for $45 million. This is a restaurant software point-of-sale provider with an installed base of over 10,000 restaurants that are not using Shift4. The company is profitable, generating roughly $7.5 million in revenue and $4.7 million in EBITDA in 2022. However, the card payment volume associated with this installed base of restaurants running focus pass is roughly $15 billion.

We anticipate this — we believe this acquisition was completed at reasonable valuations for a stand-alone business, but actually represent highly attractive customer acquisition costs. We also believe it will further bolster our tech talent and distribution capabilities and provide downside protection due to the existing revenue and profitability. We do not place any weighting to the existing economics in our guidance, because our plan will mean pivoting the existing revenue model towards payments as we convert customers. Over time, this population will have the opportunity to upgrade the SkyTab as well which is what Jared mentioned earlier. As we’ve been mentioning for a few quarters now, we continue to put distance between ourselves and the competition.

We believe our disciplined growth strategy, massive opportunity to convert existing customers’ balance sheet and strong cash flow generation puts us in rarefied air, despite the uncertain climate. This attracts both talented candidates and acquisition targets, who see an opportunity to join Shift4 and win at an accelerated pace. We are investing a significant amount of resources towards M&A as a result. The environment for both tuck-ins like Focus POS and transformational deals is as ripe as we’ve seen in the last decade. With that, I’d like to turn the call over to our CFO, Nancy.

Nancy Disman: Thanks, Taylor and good morning everyone. In the first quarter, we delivered impressive results, including quarterly records for volume and gross revenue less network fees. We also delivered meaningful year-over-year improvement in our adjusted free cash flow, consistent with trends witnessed over the past several quarters. For the quarter, total Q1 volume of $22.3 billion grew 66% compared to the same period last year. Q1 gross revenues were $547 million, up 36% from the same quarter last year and gross revenue less network fees were $200 million, an increase of 34% over last year. Our adjusted EBITDA for the quarter was $89.3 million and our adjusted EBITDA margins for the quarter were 45%. Our quarterly results were driven by the continued strength of our high-growth core, momentum in our new verticals and improved economics earned from our gateway customers and higher unit economics, resulting from our decision to in-source a large portion of our go-to-market distribution in connection with the launch of SkyTab.

As a reminder, this was a strategic decision, to gradually sunset and consolidate legacy POS software brands, and establish a direct sales team to promote SkyTab POS in many major markets. As expected, we continue to add and ramp very large enterprise merchants, which is resulting in lower blended spreads. The blended spread for the first quarter was 66.5 basis points versus 76 basis points a year ago and 71.1 basis points last quarter. The sequential decline in spreads from Q4 to Q1 was driven by the new strategic enterprise agreement signed last quarter with a major hospitality operator and a stronger mix towards lower take rate merchants in our new verticals, against what is seasonally the slowest quarter for our higher take rate restaurant customers.

We expect the ongoing mix shift towards larger enterprise accounts to average down spreads. And as Taylor mentioned, we would anticipate our blended spreads to average around 65 basis points for the full year, though can vary quarter-to-quarter. Again, the spread compression is entirely a function of rapid volume growth from our strategic enterprise accounts and new verticals. Spreads in our high-growth core remained stable. We continue to be pleased with our margin expansion. For the first quarter, our nearly 45 — at nearly 45% adjusted EBITDA margins, represented roughly 1,500 basis points of expansion compared to first quarter of 2022 levels. We delivered this margin expansion, despite ongoing growth-related investments, including international expansion, new vertical expansion, the SkyTab product launch and ongoing talent upgrades across the organization.

Additional opportunities to further improve margins are still on the horizon, including the ability to in-source processing for which we spend about $25 million per year. Our adjusted free cash flow in the quarter was $58.3 million and our adjusted free cash flow conversion was 65%, well above our full year guidance of 52% plus. We are taking advantage of some of our free cash flow outperformance, as Jared mentioned to consolidate upgrade and expand our facilities and to replace our legacy internal systems with more modern sales force-based applications. Capital expenditures for the quarter included $3.5 million towards these initiatives. We remain highly committed to a disciplined approach to cost management while continuing to balance investments to support our growth.

Net income was $20.4 million for the first quarter Net income per Class AMC share was $0.26 and $0.24 per share on a basic and diluted basis respectively. Adjusted net income for the quarter was $44.4 million or $0.51 per AMC share on a diluted basis on 86.4 million average fully diluted shares outstanding. We are exiting the quarter with just over $817 million of cash $1.8 billion of debt and $100 million undrawn on our credit facility. Our net leverage at quarter end was 2.9 times, and approximately 2.5 times, when adjusted for the contribution of all recent initiatives based on the trailing four quarters of adjusted EBITDA. Our strong balance sheet and free cash flow profile will continue to allow us to invest in the business pursue our strategic priorities and opportunistically repurchase shares as Jared mentioned earlier.

Turning to full year 2023 guidance, we are increasing the low end of the range for our KPIs and the high end of the range as well for volumes adjusted EBITDA and free cash flow. The increase in our guidance reflects the first quarter outperformance and is tempered by cautious optimism regarding the current operating environment. When we introduced our guidance in late February, we indicated our ranges accounted for a variety of business and economic scenarios which proves appropriate in hindsight given the events of the first quarter. Since introducing the guidance we believe the macroeconomic climate has only become more uncertain and the low end of our guide continues to contemplate modest headwinds in consumer spending. The high end of our guidance implies a continuation of recent trends.

Regardless of the operating environment we remain confident in our ability to deliver best-in-class growth and profitability among our peer set. As Taylor mentioned, Finaro is not included and will be adjusting our guidance when the closing date becomes certain. Our updated guidance for 2023 includes total end-to-end volumes of $104 billion to $110 billion representing 45% to 54% year-over-year growth. Gross revenues of $2.55 billion to $2.7 billion, representing 28% to 35% year-over-year growth. Gross revenue less network fees of $920 million to $955 million, representing 26% to 31% year-over-year growth, and adjusted EBITDA of $420 million to $440 million, representing 45% to 52% year-over-year growth. We anticipate adjusted EBITDA margins to expand approximately 600 basis points at the midpoint of our guidance ranges up from our prior assumption of approximately 500 basis points and adjusted free cash flow to be at least $225 million versus $200 million previously.

As a reminder, this guidance does not include Finaro or any other contemplated M&A in 2023. With that, let me now turn the call back to Jared.

Jared Isaacman: Thank you, Nancy. And operator, we are ready to take questions. Operator?

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Q&A Session

Operator: [Operator Instructions] Your first question comes from Rayna Kumar with UBS. Your line is now open.

Operator: Your next question comes from Timothy Chiodo with Credit Suisse. Your line is now open.

Operator: Your next question is from Will Nance with Goldman Sachs. Your line is open.

Operator: Your next question is from Darrin Peller with Wolfe Research. Your line is open.

Operator: Your next question comes from Ashwin Shirvaikar with Citi. Your line is open.

Operator: In the interest of time our final question comes from Andrew Jeffrey with Truist Securities. Your line is now open.

Jared Isaacman: Thanks. And I appreciate everyone joining us on the call today and we’ll talk to you soon. Thank you.

Operator: This concludes today’s conference call. You may now disconnect.